Energy as a Service Market Size To Hit USD 147.56 Billion by 2029 | exhibiting a CAGR of 11.1%
Fortune Business Insights
9 min read
Fortune Business Insights
The global Energy as a Service Market is projected to grow at 11.1% CAGR and reach USD 147.56 Billion during forecast period of 2022 to 2029: Fortune Business Insights
Pune, India, Feb. 23, 2023 (GLOBE NEWSWIRE) -- The global Energy as a Service Market size is projected to grow from USD 70.46 billion in 2022 to USD 147.56 billion by 2029, at CAGR of 11.1% during forecast period. In 2021 the global market size was valued USD 64.34 billion and North America Energy as a Service Market was at USD 28.49 billion. Reduced energy costs, decreased carbon emissions, and strong demand for renewable energy resources are likely to enhance the industry's progress. Fortune Business Insights™ presents this information in its report titled “Energy as a Service Market, 2022-2029.”
The Energy as a Service (EaaS) market refers to the energy services to customers on a subscription or pay-per-use basis, rather than traditional methods of energy ownership and management. This emerging market is driven by a growing demand for sustainable energy solutions, cost-effective energy management, and digital transformation. The market growth is primarily driven by increasing energy consumption, rising energy costs, and a shift towards renewable energy sources. The market is also being driven by technological advancements such as IoT, AI, and cloud computing, which are enabling the development of more sophisticated energy management systems.
Key Industry Development
Johnson Controls launched OpenBlue Net Zero Buildings as a Service. This launch may allow Johnson Controls to offer companies a one-stop shop to help them achieve renewable energy goals and net-zero carbon.
Some of the key players in the EaaS market include Schneider Electric, ENGIE, Siemens AG, Edison Energy, and Enel X. These companies are focusing on developing innovative solutions that leverage the latest technologies to improve energy efficiency, reduce costs, and increase sustainability.
Strong Energy Demand in Several Sectors to Foster Market Progress
Energy Supply Service to Dominate the Market Owing to Rising Population and Increasing Consumers
Driving Factors
Strong Energy Demand in Several Sectors to Foster Market Progress
Energy as a service includes analytics, energy, and technology sales. The product comprises analytics, energy, technology sales, and other personalized services. The strong demand for energy in several sectors is expected to enhance the service adoption. Furthermore, the rapid growth of charging stations and rising production rates are likely to enhance the service adoption. Moreover, the expansion of working rates in the automotive sector is expected to enhance the industry's progress. These factors may drive the energy as a service market growth.
However, heavy capital investments for the establishment and the switch to advanced grids are expected to impede industry growth.
COVID-19 Impact
Halt on Industrial Operations Negatively Affected Market Growth
This market was negatively affected during the COVID-19 pandemic due to halt on industrial operations. The alarming spike in COVID-19 patients led to the immediate shutdown of industries and commercial spaces. However, the rising investments in the development of renewable energy resources are likely to enhance the adoption of Energy as a Service (EaaS). Moreover, the introduction of favorable policies and service models is expected to enhance the industry’s growth.
For example, Centrica Business Solutions (CBS) announced a novel EaaS bundle in June 2020. The bundle is designed especially for investors looking forward to investing in energy-saving technologies. These factors propelled the industry's growth during the pandemic.
The Energy as a Service (EaaS) market is growing rapidly and is expected to continue to do so in the coming years. The market can be segmented by service type and end-user.
Energy Supply Service to Dominate the Market Owing to Rising Population and Increasing Consumers
In terms of service type, the EaaS market can be segmented into energy supply service, operation and maintenance, and optimization and efficiency service.
The energy supply service segment involves the provision of energy supply to customers on a subscription or pay-per-use basis. The energy supply service segment is expected to dominate the market due to the rising population and increasing consumers in every region. It allows consumers to implement water and energy efficiency projects without upfront capital investments.
The operation and maintenance segment involves the management of energy infrastructure, including equipment maintenance and repair.
The optimization and efficiency service segment involves the use of data analytics and technology to optimize energy usage and improve efficiency. The optimization and efficiency service segment is particularly relevant to the industrial sector, as it can help these industries reduce their energy consumption and improve their bottom line.
Commercial Segment to Dominate Owing to Availability of Commercial Spaces
In terms of end-user, the EaaS market can be segmented into industrial and commercial.
The industrial segment includes manufacturing, transportation, and other heavy industries, while the commercial segment includes office buildings, retail spaces, and other commercial properties. The industrial segment is expected to grow in coming years, as these industries have a high demand for energy and are increasingly focused on sustainability and efficiency.
The commercial segment is expected to dominate the market due to commercial spaces' availability. Furthermore, the high electricity consumption is expected to enhance the adoption of EaaS. The commercial segment is also expected to grow, as businesses are increasingly focused on reducing their carbon footprint and operating more sustainably.These factors may allow for industry growth.
Regionally, the market is clubbed into North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa.
Report Coverage
The report provides a detailed analysis of the top segments and the latest trends in the market. It comprehensively discusses the driving and restraining factors and the impact of COVID-19 on the market. Additionally, it examines the regional developments and the strategies undertaken by the market's key players.
Strong Demand for the Service from the U.S. to Propel Market Growth in North America
North America is expected to dominate the energy as a service market share due to the rising demand for the service from the U.S. The market in North America stood at USD 28.49 billion in 2021 and is expected to witness major growth during the coming years. Furthermore, rising renewable energy installations may enhance industry growth.
In Europe, significant power generation technologies installations and favorable organizational and governmental policies are expected to elevate the service adoption. Furthermore, developing plans for fortifying and expanding grid infrastructure are likely to enhance EaaS adoption.
In Asia Pacific, rising financial backing by governments, increasing clean energy awareness, and the fulfillment of demand & supply are expected to foster EaaS adoption. Moreover, rapid commercial and domestic space constructions are likely to enhance EaaS adoption.
Competitive Landscape
Companies Enter into Agreements to Improve Service Portfolio
Prominent companies operating in the market enter into agreements to improve their service portfolio. For example, Rolls-Royce decided to partner with Sustainable Development Capital (SDCL) to offer EaaS solutions capable of accelerating sustainable power uptake in November 2021. The agreement between both companies was signed at the 26th annual submission of the “Conference of the Parties” (COP26). This development may allow the company to improve its product portfolio and enhance its brand image. Furthermore, companies devise mergers, expansions, partnerships, and acquisitions to enhance their overall market position.
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